March is almost over and will mark the end of phase 1 for me. Overall I would say just okay. Not good, but not terrible either. I’m sitting at -2% for the year, which I hope to turn into +10% by the end of the year.
I need to do a better job of tracking my trades and evaluating my trading opportunities accordingly. It’s a bit difficult because as I think I’ve mentioned before, my trading is basically through market patterns. These take shape in all sorts of forms, and as a result, there are trades ranging all over the place in terms of risk to reward, with the probability being the key element, like below:
low probability, low risk, high reward
average probability, average risk, average reward
high probability, high risk, low reward
In such a structure, who’s to say which is correct? However, when I trade all of them, I find that it is easy to miscalculate exactly how much risk to put in on each trade. When I’m trading for quarters and dollars, little changes make noticeable differences (i think).
I want to to a better job at evaluating the trades I take, both during the trigger-pull and the post eval. I find that to do so, I must “let people in” so to speak, into how I actually trade. These boards are a little barer than they used to be, so after some consideration, I don’t mind doing so as much anymore But before anyone gets too excited, there are no secrets to be revealed, only theories to build on.
I was, and am, very hesitant to put out this sort of content in the public space because well, it might just not work. And in the process, I don’t want to draw too much attention to a method that could just be plain terrible. This isn’t a system that one can just test for a little and conclude that it sucks and waste a little time. It is instead built on theories and ideas about how the market works - things that one can’t [I]simply[/I] test. As a result, if such a theory or idea is bad, then the resulting tester wastes a tremendous amount of time. And for that, I feel bad. And so, although obvious, take everything with a grain of salt, with a suspicious eye, with a skeptic’s POV to wait for not when it succeeds, but fails.
Here we go:
I haven’t put too much time into trading lately, but here are my “big ideas”, or chart structures that I think a lot about when it comes to trading these days, and have been working on since the start of my career (lol). :
Daily direction (Price) - Momentum. Price that has moved in a specific direction has a tendency to continue in that direction. If price is up 20 pips, it is more likely to finish at +40 than it is 0 or -20. This is not “physics”, this is just a fact of markets and of many inanimate facets of life.
Daily minimum move (Price) - Barring massive holidays, price moves. It is more likely to be at +40 or -40 than it is to be between -40 and +40. Nothing new, but combined with other knowledge it gives the trader a good place to put conservative TP/SL marks.
Currently weekly structure (Price) - Price is not random. If one were to track a weeks high and low, they tend to occur over a period of 2-3 days. It does not take a week to develop, nor does it constantly make new weekly highs followed by weekly lows.
Current wave (Price) - Traders pay attention to current highs and lows. Price will be tugged towards one end or the other.
Likely wave pattern (Price) - The concept of a trend wouldn’t exist if it didn’t at least work some of the time. They do exist, and they do work.
Current pattern in wave (Price) - Trends don’t last forever, and things that aren’t trends can’t stay that way either.
Current time with respect to current wave (Time) - Similarly, price doesn’t trend forever, and things that aren’t trends can’t stay that way forever.
Current time with respect to previous waves (Time) - Sometimes, certain hours of the day favor certain types of moves, specifically tops and bottoms. This isn’t extremely reliable, but boy does it look insane when it works.
Not going to give charts for all of these, but will likely be labeled in future posts.